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Creative content in a European digital single market: a reflection document

Position Papers, published on 05 January 2010 Download document

Executive Summary

Commercial broadcasters are key players in the content industry. We are at the same time creators, investors and distributors of content which confers us a unique position with respect to copyright: we are both owners of copyright and as well as mass users/purchasers of copyright. Content is the core of our businesses and broadcasters will therefore continue to invest in new productions – but this investment in Europe's creative community needs to be encouraged and safeguarded.

The current system of release windows is essential for commercial broadcasters and other players to maintain a sustainable level of investment and the Reflection Document fails to address this crucial aspect, preferring instead to view the system of release windows as somehow a "barrier" to the Information Society. Little evidence is produced in the Paper to support this claim, indeed the Paper rather ignores strong evidence to the contrary, as the windows system has evolved significantly in line with market developments.

The role of broadcasting and television production as a whole is not properly discusses in the Reflection Document as a whole. This is perhaps unavoidable in a single paper attempting to cover many different sub-sections of the "content industry" – the structure and characteristics of the markets for "content" differ enormously between music, the printed word, and audiovisual content. While it may be appropriate for a political "reflections paper" to consider all the separate sectors in very general terms as "content", the Commission will, in the event that there is to be legislative follow up to any of the issues raised in the Reflections Paper, need to carefully take into account the specific features and needs which differentiate each industry within the cultural sector.

Indeed, any follow-up to this Paper also needs to differentiate between issues of rights acquisition – where rights are usually individually traded – and rights clearance, where rights are often subject to collective administration. For the former, contractual models should always be favoured (subject of course to competition law and sector-specific regulation). For the latter, the existence of monopoly collective management societies – while welcomed by users as providing a one-stop shop – raises different issues of competition law and of regulation.

One of the essential features of the broadcasting industry which needs to be safeguarded is the concept of exclusivity. Exclusivity is not only the main driver that enables return on investment which is re-invested in new productions but it also represents a major differentiator among different players on a competitive market.

With regards to a potential revision of the Cable and Satellite Directive, there are three key features which must be retained at all costs: country of origin for satellite distribution, contractual freedom and the broadcaster's Article 10 exemption from the obligation to exercise its own or its acquired rights via collective administration.

While we are aware of the political appeal of "pan-European services", we would call for a sense of perspective as to the likely impact of such services on the audiovisual market. For simple reasons of language, many television services will remain primarily national. Transfrontier distribution of content does take place – but only where there is a market for it. Typically, this might involve neighbouring countries which share the same language, or countries which have experienced significant emigration and therefore have identifiable diaspora populations.

We offer several examples in our submission. We conclude that these examples are strong evidence of the fact that the current legal framework does not prevent cross-border circulation of content. Legally, from an internal market perspective, the EU has the remit to safeguard the free circulation of goods, persons, services and capital but it cannot as such strictly define an area where a company should offer its services. Politically, a range of other issues including competition issues related to publicly funded broadcasters offering pan-European pay TV services and the impact on Europe's much-cherished linguistic diversity of distribution of content from elsewhere in the EU should also be considered.

The ACT believes that common rules on the governance and transparency of collective rights management organisations could help smooth out inefficiencies which appear in some markets.

We disagree with the suggestion that the current situation where the exhaustion principle applies only to tangible goods should or could be changed by way of legislation so as to apply to intangible goods as well. As argumentation, we recall the ECJ Decision in the Coditel I case.

Extended collective licensing will not solve, as the Commission appears to suggest, the issue of cross-border rights management for online content and on-demand services and should be limited to sectors where it could bring certain advantages. Any related consultations should be limited to those sectors.

With regards to alternative forms of remuneration, the ACT cautions against downgrading the exclusive rights into rights for remuneration through a global licence. This would seriously affect the value chain and the possibility to invest in quality professional content.

Overall, commercial broadcasters are sceptical as to the necessity and effects of a European Copyright Title. The Commission recognises in the Reflection Document that the current legal framework does not constitute an obstacle for cross-border